Council OKs additional $15.8 million, more time to Medicaid manager

By NANCY WESTNew Hampshire Sunday NewsDecember 19. 2012 3:10PM
Over outgoing Councilor Ray Wieczorek's lone dissenting vote, the Governor and Executive Council on Wednesday approved yet another extension and an additional $15.8 million to Xerox State Healthcare to develop and operate the state's new Medicaid management system.

That brings the total to not exceed $91.7 million. Another $12 million was previously approved to the original $61 million contract for additional state and federal requirements.

The governor and council were assured Wednesday by Nicholas Toumpas, commissioner of Health and Human Services, the additional money was for add-ons the state has requested, not because of the ongoing delays.

Toumpas has been on the firing line to answer for the delays.

"Is there risk?" Toumpas said of continuing with Xerox. "Yes, considerable risk."

But the state made a decision in 2010 to move forward with the contract that will be responsible to pay Medicaid providers despite the continuing delays.

"There's no turning back," Toumpas told them, adding there will be a contingency plan.

After the meeting, Toumpas said the contingency plan is being worked on, but he couldn't say what it will include.

It will cost Xerox $5.5 million if the system isn't operational by the new deadline of April 1, 2013, Toumpas said.

Wieczorek, R-Manchester, has been frustrated that the state hasn't cut its ties with the vendor sooner after the lead of other states.

"I'm not pleased," Wieczorek said of the additional $15.8 million "for a contract that started at $60 million."

The computer system will process all of New Hampshire's $1.4 billion Medicaid claims paid to 10,000 health care providers for services to 140,000 recipients.

The council approved the original $61 million contract in 2005 to Dallas-based Affiliated Computer Systems, which has since been acquired by Xerox.

The new completion date has been pushed back from Dec. 31, 2017, to March 31, 2018.

The design phase of the new system is 90 percent funded by the federal government and 10 percent by the state. The operations cost will be a 50-50 split between the state and federal governments.